The federal government’s paid parental leave plan will bump up Australia’s birth rate by five per cent in 2011 as working women wait to take advantage of the pay scheme, according to a population expert.

Leading demographer Bernard Salt said the promised 18 weeks’ paid parental leave for parents from January 2011, announced yesterday, will contribute to a “baby blip” early next decade.

“As significant as this event will be, it will not in the same magnitude as a baby boom. At best it will be a baby blip,” Mr Salt said.

“People are always more interested in investing in a child once their economic prospects are more certain.”

About 280,000 babies are born in Australia each year since the last significant birth rate rise in 2000. That equates to about 1.9 children per woman.

Mr Salt said it was likely 14,000 more babies would be born in 2011 as a result of the parental leave provision, resulting in about 294,000 total births.

“Basically having kids is a vote of confidence in the future, so when times are uncertain people delay or postpone having kids,” he said.

“No one really knows what is happening during the downturn. The expectation is though that the birth rate will have dropped to 265,000 (babies born), compared to 280,000 children born in the year to December 2007.”

However, women who have postponed having children should jump back on the baby bandwagon from 2011, he said.

Mr Salt joined businesses and unions in welcoming the taxpayer-funded scheme, which will see parents earning less that $150,000 a year entitled to $543.78 for 18 weeks.

He said the 30-year-long battle for paid parental leave signalled a dramatic shift in Australian working culture.

“The reality is that we will find that a whole series of measures, baby bonus, paid parental leave, and more flexible work hours from employers will contribute to a cultural change.

“We will evolve a culture, certainly over the next 10 years, which will be highly supportive of having children.”

Queensland Council of Social Services (QCOSS) president Karyn Walsh said the scheme would afford low income workers the confidence to have children without the fear of losing vital pay.

“This is a blessing that will give a lot a parents security and reassurance,” Ms Walsh said.

“It gives people the confidence that they will be able to have time with their child and have an income.

“People in low income jobs were least likely to get paid parental leave from their employer, because some businesses really just don’t have the money to do that.

“It will save families from having to rely on one income, during which time they might not be able to maintain their mortgages or have enough money for transport or electricity.”

Mother-of-five Anna Wright, celebrating Mothers’ Day in New Farm Park yesterday, said she would not have waited for the scheme to become effective if she were planning to have another child, but welcomed paid parental leave as another vital option for mothers.

“If I were having children now, I don’t think it would change what I would do or my plans for the future, but what’s important is that the option is there for women and it is the option that is critical to women,” she said.

Less than 24 hours after the federal government’s announced plans to introduce paid parental leave, business groups are raising concerns about the cost.
The Australian Chamber of Commerce and Industry (ACCI) has called on Labor to compensate companies for administering the scheme which offers primary carers earning less than $150,000 a year 18 weeks of post-natal leave paid at the minimum wage.

The Organisation for Economic Cooperation and Development (OECD) has welcomed Australia’s plan to introduce a parental leave scheme but says it is less generous than what is offered by other countries.

Of all the advanced economies, Australia and the United States are the only countries that do not offer statutory paid-maternity leave.

Economist Willem Adema of the OECD’s Social Policy Division welcomes the announcement of an Australian scheme to begin in 2011 but says the amount allocated to it is low when judged against similar schemes around the world.

While Australia’s proposal is means tested, the paid leave offered in the other 38 other OECD countries is open to all parents, regardless of income.

The OECD reports that in many European countries parents are given between 75 and 100 per cent of their wages for up to 18 months.

BUDGET 09: AUSTRALIA will finally join the rest of the Western world in introducing a paid parental leave scheme, but not till 2011.

And the scheme will not be universal. Around 140,000 stay-at-home mums – and the rich – will miss out.

But tens of thousands of women who work part-time or casually could end up getting more than their working wage.

Eligible parents will collect at least the minimum wage of $544 a week while on 18 weeks’ leave to look after newborns.

Treasurer Wayne Swan used Mother’s Day yesterday to announce the scheme, as final touches were applied to a Budget billed as the toughest in living memory.

An attack on middle-class welfare – including means-testing of the private health insurance rebate and elimination of lucrative superannuation concessions – will allow for tax cuts and an increase in age pensions.

But the Budget is still expected to plunge to a record deficit of around $60 billion, while borrowings will blow out to as much as $300 billion.

Consequently, the parental scheme is unlikely to begin until January 1, 2011 – possibly after the next election.

Mr Swan said that start-up date was necessary because the global economic crisis had ripped a $200 billion black hole in revenue over four years.

But shadow treasurer Joe Hockey said this was “putting promises on the never-never”.

Mr Swan said: “We are one of only two countries in the Western world that doesn’t have paid parental leave.

“We have got to get that balance between work and family right, and paid parental leave is an essential reform,” he told the Nine Network.

Families in which the main breadwinner earns $150,000 or more will be ineligible.

And to qualify, a prospective mum would have to have worked only 330 hours, or one day a week for 10 months in the 13 months before the birth.

The $5000 baby bonus will be bundled into the new payment.

But stay-at-home mums will get only the baby bonus, plus family tax benefits, halving the overall cost of the scheme to around $260 million a year.

“Stay-at-home mothers are being dudded once again,” Australian Family Association president John Morrisey said.

“And 18 weeks is not long enough anyway. A child needs two or three years of one-on-one with their mother, instead of becoming aggressive graduates of long day care.”

But working mum Sarah Horton wishes the scheme had been available sooner.

“It would have been fantastic to have had financial help with our first child. In all probability, we would have started a family earlier,” she said.

Mrs Horton, who gave birth to Ned Robert yesterday, said the scheme would be fantastic news for her next child.

“It means we can go ahead without the worry and concern about financial stability.”

Parents can share the 18 weeks’ leave, or one parent can take it all. And workers can still use parental leave provided by employers, either at the same time or back-to-back.

Employers will not contribute to the government scheme or cover superannuation on leave entitlements.

But Australian Chamber of Commerce and Industry chief Peter Anderson warned the Government not to force businesses to pay administration costs, which could leave them out of pocket.

Though welcoming the announcement, Council of Small Businesses of Australia chief Jaye Radisich said its impact on small businesses would be greater.

“But if you want to encourage women to have babies, maternity leave is good for society,” she said.

Ms Stott Despoja says the global financial crisis would be no excuse if a government-funded plan was left out, because “the economics show it is easily do-able”.

And she warns that progress on family-friendly schemes, such as breastfeeding breaks, has largely stalled.

Ms Stott Despoja says the right to breastfeeding breaks could be enshrined in workplace agreements and that most businesses were capable of providing “a clean, private and secure room” for mothers to breastfeed or express milk.

“It’s a short interruption to her (working) day,” she says.

But while this issue remains close to Ms Stott Despoja’s political heart, it no longer applies personally.

She quit her 13-year senate career last June and lives in Adelaide with her husband, former Liberal Party adviser Ian Smith, and their children.

But her resignation was in no way an admission women can’t have careers and family.

“I have had a wonderful, full-time – more than full-time – career and I was really proud of how I balanced work and family because everyone knows it involves a degree of sacrifice or difficulty,” she says.

“I like to think I am living proof of what feminism is all about and that is choice.

“I have been in the fortunate position where I could make that choice. And for me (resigning) was such a clear decision, the right decision.

“That’s not because I don’t love politics or my party.

“But there were certain things in my family’s life that I didn’t want to miss out on, like going with Conrad on his first day (of pre-school) and seeing my husband more often.